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Breach of employment contract not basis for a tort action.


BREACH OF EMPLOYMENT CONTRACT NOT BASIS FOR A TORT ACTION

Samuel M. Sorkin sued the accounting firm of Blackman, Kallick and Co. for breach of contract, willful and wanton Grossly careless or negligent; reckless; malicious.

The term wanton implies a reckless disregard for the consequences of one's behavior. A wanton act is one done in heedless disregard for the life, limbs, health, safety, reputation, or property rights of
 damage to reputation and fraud after the firm allegedly reneged on an agreement to make him a 15% equity partner within a year after he joined the firm.

In the fall of 1984, when Sorkin accepted a position as director of tax services at Blackman, he terminated his position at Coopers & Lybrand in Columbus, Ohio Columbus is the capital and the largest city of the American state of Ohio. Named for explorer Christopher Columbus, the city was founded in 1812 at the confluence of the Scioto and Olentangy rivers, and assumed the functions of state capital in 1816. , moved his family to Chicago and announced his upcoming partnership to family, friends and business associates. In June 1985 he was told Blackman was changing the deal and he would not be made partner. In December 1985, Blackman indicated he still might be made partner. Based on this representation, Sorkin remained at Blackman through the 1986 tax season. Immediately after the tax season, Sorkin was informed he would never become an equity partner at Blackman. He subsequently left the firm and filed suit against it.

The appellate court A court having jurisdiction to review decisions of a trial-level or other lower court.

An unsuccessful party in a lawsuit must file an appeal with an appellate court in order to have the decision reviewed.
 ruled that simply characterizing a breach of contract as willful and wanton conduct does not give rise to a tort action. This ruling's significance is that the plaintiff cannot recover punitive damages Monetary compensation awarded to an injured party that goes beyond that which is necessary to compensate the individual for losses and that is intended to punish the wrongdoer. , and recovery of compensatory damages A sum of money awarded in a civil action by a court to indemnify a person for the particular loss, detriment, or injury suffered as a result of the unlawful conduct of another.  is limited to those that are a probable consequence of the breach of contract. Therefore, even if the plaintiff prevails on his contract action (still pending at the trial court level), the possibility of a larger recovery against the defendant is remote.

This is one of several recently decided cases that sharply curtail an employee's right of recovery against an employer for alleged wrongful termination wrongful termination n. a right of an employee to sue his/her employer for damages (loss of wage and "fringe" benefits, and, if against "public policy," for punitive damages).  or breach of employment contract. (Samuel M. Sorkin v. Blackman, Kallick and Co., Ltd. 540 N.E. 2d 999)
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Copyright 1990, Gale Group. All rights reserved. Gale Group is a Thomson Corporation Company.

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Author:Baliga, Wayne J.
Publication:Journal of Accountancy
Date:Feb 1, 1990
Words:293
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